Submitted: December 11, 2018
from United States District Court for the Western District of
Missouri - Jefferson City
SMITH, Chief Judge, WOLLMAN and GRASZ, Circuit Judges.
WOLLMAN, Circuit Judge.
years ago, Matthew Concannon, M.D., signed a general guaranty
for a company that he thought he owned in part with his
trusted friend and financial advisor. What his friend
purportedly failed to mention in this otherwise routine
exercise of obtaining his signature was that the guaranty
would saddle Concannon with millions of dollars in debt from
loans that his friend had obtained and was unable to repay.
Concannon urges us to conclude that he was defrauded by his
friend, that his friend acted without his authority in
delivering the guaranty to the bank, or that the bank's
successor in interest, Radiance Capital Receivables
(Radiance), lacks a proper chain of title to enforce the
guaranty. The district court determined that Concannon was
liable, and we affirm.
graduated from medical school at the University of Missouri
in 1987. After training in hand and microsurgery, he returned
to the University to join the medical school faculty. There,
Concannon retained the services of José
Lindnerupon the suggestion of a faculty mentor.
Lindner served as a financial planner and tax preparer for
several prominent physicians in the area. The two became
friends, and Concannon enlisted Lindner to advise him
financially, prepare his taxes, and generally assist with his
various business ventures.
left the University in late 2006, and Lindner assisted him in
opening his own private medical practice shortly thereafter.
Lindner handled the business's books and continued
assisting with Concannon's tax and financial matters,
including drafting and preparing the operating agreement for
Concannon's holding company. Concannon trusted Lindner
"more than [he could] describe" and gave Lindner
complete access to his financial and business records.
Concannon testified in an unrelated matter that, in his
words, "I paid [Lindner] to act on my behalf. . . . As a
matter of routine, I-when [Lindner] would give me stuff to
sign, I would just sign it."
also managed his own commercial real estate developments, one
of which involved an entity named Providence Farms, LLC
(Providence). Lindner offered Concannon an opportunity to
obtain a dollar-for-dollar tax credit by investing in
Providence and its various infrastructure construction
projects, and Concannon agreed to invest $600, 000. Lindner
handled Concannon's involvement with Providence and
regularly sought his signature on related documents,
including those purporting to add Concannon's holding
company as a member of Providence with a 50% ownership
interest. Concannon also signed guaranties permitting Lindner
to obtain and renew, on Providence's behalf, millions of
dollars in loans from various financial institutions.
signed a general guaranty for Providence on January 24, 2008.
The document listed Premier Bank as the lender and guaranteed
all of Providence's "present and future debts"
of "every type, purpose and description,"
including, "without limitation, all principal, accrued
interest, attorney's fees and collection costs."
Unbeknownst to Concannon, Providence teetered on the brink of
foreclosure at the time, and various banks had required
Lindner to obtain guarantors and investors to keep Providence
afloat. In subsequent years, Concannon also made personal
loans to Lindner at the latter's request to enable
Providence to make its loan payments. Concannon insisted on
collateral for one such $240, 000 loan in late 2009. Around
that time, he attended two meetings between Premier Bank and
Lindner, during which the bank informed Lindner that it
needed payment on the loans.
did not make its loan or interest payments and defaulted. The
company and its projects were a sham; Concannon did not
receive a tax credit or a membership interest, and the
infrastructure projects which he purportedly funded with his
investments in Providence were never constructed.
Bank failed in 2010. The Federal Deposit Insurance
Corporation (FDIC) took over its assets, which included the
right to collect from Providence. The FDIC created the entity
CADC/RADC Venture 2011-1 (CADC), which the FDIC owned jointly
with a private investment company, and sold Premier
Bank's assets to it. CADC obtained a consent judgment
against Providence in Missouri state court in September 2014
for $15.7 million plus interest. Concannon had been dismissed
as a defendant in the state action, and he did not object to
the consent judgment. CADC then sold Providence's debt
obligations to Radiance in May 2016 and thereafter executed
and filed an Assignment of Judgment in Missouri state court
assigning the consent judgment against Providence to
filed suit in federal district court against Concannon to
collect the burgeoning amount owing from the consent
judgment, which now approaches $22 million. Relevant here,
Radiance claimed that Concannon breached his guaranty. The
district court granted Radiance's summary judgment motion
in part, concluding that Radiance had a valid assignment of
Providence's debt. Following a bench trial in October
2017, the district court determined that Lindner had acted
with Concannon's actual authority to deliver the signed
guaranty to Premier Bank and that Concannon failed to
establish a fraud-in-factum defense. The court ordered
Concannon to pay the full amount owing on the consent
judgment and granted Radiance's motion for ...